The Billfold Book Club: Suze Orman’s ‘The Money Book for the Young, Fabulous & Broke’

Suze

There are two Suzes.

I really like the first Suze. I’d say 90% of the book was written by the first Suze, possibly in combination with the first Suze’s ghostwriter/assistant. This Suze gives you exactly what she promises: a clear, straightforward explanation of how FICO scores work, how a 401(k) works, how to buy a car, and all of those other financial details that are extremely useful to people just getting started in life.

She’s even aware that her Gen X and Millennial readers are experiencing different financial realities than previous generations, and addresses her advice to fit these circumstances. Perhaps her most infamous piece of YFB advice is to go into credit card debt to finance your early career, since you won’t be earning enough money yet to pay for your necessary expenses.

(If you are familiar at all with the Suze Orman story, you’ll know that’s exactly what she did: when she got her first job at Merrill Lynch after six years of waitressing, she immediately bought a $3,000 professional wardrobe on credit. That was in the very early 1980s, and according to the US Department of Labor’s inflation calculator it would be the equivalent of putting $8,661 on your credit card today — just for clothes.)

So I really don’t have any problems with the first Suze. She seems cool.

But then the second Suze slips in.

This Suze is probably who we’ll look at when we read Helaine Olen’s Pound Foolish for July. This is the Suze who says “if you can’t follow my advice, it’s your own fault.”

In Chapter 5: Save Up, the second Suze lists some ways that a YFB adult can save money. These methods include:

  1. Drop your life insurance (if you are single with no dependants)
  2. Drop your landline
  3. Stop going to the movies every weekend
  4. Get a roommate

 

The last one in particular is presented as if you are currently living in a two-bedroom apartment by yourself and all you have to do is clear out some space for a second person.

Likewise, if you can’t get a job, the second Suze actually suggests pounding the pavement and cold-calling HR managers. (She cites an example where a young woman cold-called 10 different school principal’s offices, got five of those offices to invite her in for an interview that day, and ended the day with three job offers.)

It’s the second Suze who does not precisely condescend (she promised not to condescend, after all) but does occasionally snark:

“A trip to Cabo to decompress after a big project at work is not an emergency.”

“You won’t catch me telling you to cut back on the lattes and “simply” save $10 a day. As if saving $3,650 a year when you are broke could ever be simple.”

But lattes don’t actually cost $10 (ask Oscar the Grouch), most of us have already given up landlines and taken on roommates, and if anyone can replicate the 24-hour “10 cold calls, 5 interviews, 3 job offers” stunt, I’d like to interview you for The Billfold so please get in touch with me, okay?

When you present your financial advice as an outsized “don’t take that trip to Cabo!” you give yourself the privilege of skipping over actual financial decisions that YFB people make, which are more often “should I buy myself this pizza to decompress after a big project at work, am I ever going to make enough money to pay off the investment in my education and early career, what should I do if I’m already living with roommates and still can’t pay my rent?”

Before I turn the discussion over to y’all, I’ll remind you of one more piece of advice from Second Suze:

If you need to pay off your credit cards, all you have to do is go into your closets and take out anything you haven’t worn in a year or anything that has the tags still on. You’re going to sell all that stuff, but first you’re going to put that stuff in a pile, because Suze says: “I bet if you sat down and added up the cost of everything in that pile, it would account for a high percentage of the credit card balance you currently have.”

That’s why we can’t get ahead, fellow YFB-ers. It’s because we spend too much of our money on clothes, and because we’re not smart enough to pay off our debts by selling all of our outfits that still have the tags on.

 

Previously: “It’s Time to Discuss ‘Rich Dad, Poor Dad'”

 

 

Photo: Jason Meredith

 

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